Wal-Mart Case Is a Victory for Consumers

The Supreme Court handed down a big win for American consumers this week, though the case had nothing to do with consumer protection. The court's decision involved the rules for determining what constitutes a proper class of plaintiffs, representing not just those individuals who have come forward to allege illegal behavior but others who have been similarly harmed.

These so-called class-action lawsuits reward plaintiffs' lawyers handsomely if they succeed -- resulting in millions of dollars in attorneys' fees in some cases. What's more, the mere threat of a large class-action suit often forces a company into negotiating a generous settlement, even if it's undeserved, just to avoid the costs of having to defend itself in court. And we all end up paying for it in higher prices.

In Wal-Mart Stores Inc. v. Dukes, attorneys representing three female Wal-Mart employees alleged that the company engaged in discrimination against women workers. They sought back pay and other relief not just for their actual clients but also on behalf of more than 1.5 million women who work at Wal-Mart. Two lower courts had sided with plaintiffs' in certifying the case as a class action against the behemoth retailer, but the Supreme Court rejected the claim.

It's hard to imagine a flimsier case than the one offered by the attorneys on behalf of the actual women alleging discrimination by Wal-Mart.

One of the women worked first as a Wal-Mart cashier before being promoted; she was later demoted based on repeated violations of company policy, which she admitted to. Another woman received promotions to a supervisory position with the company, but alleged discrimination because a store manager yelled at her and told her "to doll-up, wear some make-up and dress a little better."

The third woman asked a store manager about management training and felt she received a brush-off, so she initiated a complaint within the company. She was told to bypass the manager and apply directly to district management for admission to the training program but never followed up. She was later fired for timekeeping violations.

In addition, the attorneys presented affidavits from 120 other women alleging sex discrimination. But even if every one of these claims had merit, does it follow that all 1.5 million female Wal-Mart employees have faced similar problems?

Misc.

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